With Democrats taking control of the House and Senate in January 2027, Republicans are scrambling to pass as much of their agenda as possible during the lame-duck session. The rush will tempt the short-term majority to use a political shortcut: enacting new spending without paying for it. That can be expedient, but it does not justify drowning the country in more red ink.
Adding to America’s $40.5 trillion gross debt would be an irresponsible way for Republicans to use the final weeks of their trifecta. At a time of low unemployment and economic growth, deficits add to inflation and interest-rate pressures, meaning higher prices and heavier mortgage payments.
Republicans will have many opportunities to choose between political shortcuts and fiscal responsibility during the lame duck and must shrink deficits rather than add to them.
Debt Limit
Republicans are discussing attaching a debt limit increase of as much as $5 trillion to reconciliation or appropriations. This would be in addition to the $5 trillion debt limit increase Republicans passed in 2025’s One Big Beautiful Bill Act (OBBBA). That would mean a total of $10 trillion in added borrowing capacity during just two years of GOP control. For perspective, it took 219 years (from 1789 to 2008) for the federal government to accumulate $10 trillion in gross debt.
Political shortcut: Republicans could enact a $5 trillion debt limit increase, either leaving the government’s unsustainable fiscal trajectory unchanged or worsening it by adding new deficit spending.
Fiscal responsibility: Republicans should pair any addition to the debt limit with enough savings to cut deficits in half in the near term.
Appropriations
The current continuing resolution expires on December 11. The Trump administration and Republican defense hawks have called for a historic $1.5 trillion defense budget, of which $1.15 trillion would be through regular appropriations. Democrats seek “parity” increases for nondefense spending. There is precedent for this: The first Trump administration featured two deals that increased both spending categories by hundreds of billions of dollars.
Political shortcut: The House Appropriations Committee has set the fiscal year (FY) 2027 security (defense) budget authority level $234 billion higher than the final FY 2026 level. A bipartisan deal to increase defense and nondefense spending on a full parity basis, ignoring the need to prioritize spending within current levels, would mean a combined $468 billion increase in a single year. Extending this increase over 10 years would add $4.8 trillion in budget authority relative to the baseline.
Accounting for additional interest on the debt would push the 10-year cost to more than $5 trillion by my estimate.
Fiscal responsibility: Congress should cut and cap appropriations by removing wasteful and inappropriate spending in both the defense and nondefense categories and limiting spending growth to inflation for 10 years.
An appropriate combined topline for FY 2027, based on inflation-adjusted Budget Control Act spending levels from FYs 2015 through 2017, would be roughly $1.37 trillion. Congress moved away from the Budget Control Act levels to avoid making politically difficult choices. Although $1.37 trillion would be a significant reduction from FY 2026, the bleak fiscal outlook justifies belt-tightening.
Reconciliation
The House and Senate Budget Committees have produced FY 2027 budget resolutions that unlock $95 to $150 billion in spending through budget reconciliation without any requirement for offsets. While reconciliation was designed to make deficit reduction easier, this approach turns it into a vehicle for partisan appropriations. This has become a concerning trend, as both parties have abused reconciliation in this fashion when they had trifecta control of government.
Political shortcut: Democrats used OBBBA’s welfare reforms to attack Republicans during the campaign. As a result, some Republicans are wary of voting for offset provisions due to worries about political backlash. Republicans also want to obtain new spending on their priorities to avoid negotiations with Democrats. Republicans could thus pass new spending through reconciliation without full offsets.
Fiscal responsibility: Republicans should take full advantage of reconciliation by delivering trillions of dollars in savings to cut the deficit in half, especially if there is a debt limit increase. At minimum, they should fully offset new spending and include $672 billion in past-due offsets from the first two reconciliation packages. Both parties should agree to reform the reconciliation process by restoring the Conrad Rule, which prevents reconciliation from adding to deficits. A “super” Conrad Rule, where every dollar of new reconciliation spending requires two dollars in offsets, would make partisan appropriations especially unappealing.
Supplemental Appropriations
The Trump administration has requested $87.6 billion in supplemental FY 2026 funding, primarily in response to the war of choice with Iran and its broader effects.
Political shortcut: Congress could approve the supplemental request without offsets, either through regular order or reconciliation.
Fiscal responsibility: Congress should reject the administration’s request. At minimum, Congress should offset supplemental and emergency spending using a cut-as-you-go (CUTGO) rule rather than perpetuating the $15 trillion tab such spending has accumulated since 1991.
Highway Bill
The Highway Bill’s surface transportation programs will expire on December 11. Although the House Transportation Committee reported its bill with strong bipartisan support, other authorizing committees in both chambers have not moved their sections of the package forward. Senate Democrats are seeking to preserve spending on infrastructure for alternative-fuel vehicles that began during the Biden administration (which the House bill cuts) and increase subsidies for public transit.
Political shortcut: The House bill would add $147 billion to deficits over five years due to spending more than the federal gas tax can pay for. Congress could win over Senate Democrats by spending more on transit and “green” programs, which would make the fiscal pothole deeper.
Fiscal responsibility: Congress should eliminate or phase out most infrastructure spending, which state and local governments and the private sector can fund instead. At minimum, Congress should eliminate the roughly 30 percent of Highway Trust Fund spending that goes to low-utility and local-level diversions such as public transit, bike lanes, hiking trails, sidewalks, and ferryboats.
Farm Bill
The Farm Bill collection of agriculture and nutrition programs lapsed on September 30. Republicans and Democrats have been negotiating a final package for months, with some legislators (primarily Democrats) seeking to delay food stamp (SNAP) reforms and farm interests (primarily Republicans) seeking more federal support for biofuels.
Political shortcut: Congress could pass the Senate Agriculture Committee’s Farm Bill, which would add $4.4 billion to deficits over 10 years and set the stage for further backsliding on SNAP reform.
Fiscal responsibility: Congress should eliminate the multitude of wasteful and unnecessary agricultural programs, most of which are corporate welfare. Congress can save even more by building on the SNAP reforms that were part of the OBBBA. Undoing the Biden administration’s change to the Thrifty Food Plan would save up to $274 billion over 10 years.
Conclusion
For the items above and any other proposals that come before the lame-duck Congress, legislators will have a clear choice: ensure that they pay for new spending and seek ways to reduce the deficit, or use deficit spending to paper over political differences and push the country toward a debt-riddled and less prosperous future. Because Republicans still hold the majority in both chambers, they are responsible for making sure that bills are fiscally sound even when it is politically inconvenient to do so.